In Collingswood, New Jersey, the income tax is a tax imposed on money received (income) during a certain set time period. Under federal law, and the laws of most states, income from any source can be taxed. The federal government has had the constitutional power to impose an income tax since 1916, since the passage of the 16th Amendment. Before then, states could, and still can, impose whatever income tax they like, including in New Jersey.
While the federal income tax applies to everybody in the United States, the income taxes imposed by individual states vary widely, and some states have no income tax at all. You should consult with a Collingswood, New Jersey tax Attorney or accountant to find out if your state is one of them.
Income Tax Deductions in Collingswood, New Jersey
A tax deduction is a reduction in one's taxable income. It results in less of your income being taxable, which causes a lower tax liability.
This should not be confused with a tax credit, which is a reduction of a person's tax bill. A tax credit almost always results in a lower tax burden than a tax deduction of the same amount.
Lots of expenses that are common in Collingswood are tax deductible. Federal tax deductions include mortgage interest, union dues, interest paid on mortgages, and others.
How Can A Collingswood, New Jersey Tax Attorney Help?
Income tax law can get fairly complex in Collingswood, New Jersey. If you have any questions about your income tax liability, you should not hesitate to speak with a tax Attorney sooner, rather than later.